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AfDB Commits USD 398.7 Billion for SGR Phase 6 and 7 and Tanzania Agricultural Bank Capital Boost

AfDB SRG Tanzania DRC Burundi loan

Tanzania and the African Development Bank (AfDB) have inked two contracts totaling more than 158.1 million US dollars (TZS 398.7 billion) to advance crucial infrastructure and agricultural initiatives.

These agreements encompass the construction of the Standard Gauge Railway Project (SGR), linking Tanzania, Burundi, and the Democratic Republic of Congo (DRC), and the augmentation of the capital of Tanzania’s Agricultural Development Bank (TADB).

The signing ceremony, recently held in Dar es Salaam, saw Tanzania’s Minister of Finance, Hon. Dr. Mwigulu Lameck Nchemba, and the Resident Manager of AfDB in Tanzania, Dr. Patricia Laverley, formalize the agreements.

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Of the allocated funds, USD 91.76 million (TZS 231.3) will fuel the construction of the standard gauge railway spanning 411 kilometers from Tabora to Kigoma (Phase 6 of SGR) and 156 kilometers from Uvinza to Malagarasi (Phase 7 of SGR).

This project aims to enhance transportation infrastructure and facilitate trade in minerals and agriculture between Tanzania, Burundi, and the DRC.

Dr. Nchemba highlighted that this endeavor aligns with the goal of shifting transportation modes from road to rail, in line with the African Continent Free Trade Agreement (ACFTA).

Furthermore, Dr. Nchemba stated that the signed funds form part of the USD 502.69 million required to complete the SGR project.

AfDB has pledged to support Tanzania in the capital markets to secure the remaining funds, underscoring its commitment to bolstering the country’s transport infrastructure.

Additionally, a contract worth USD 66 million (TZS 166.4) has been sealed to enhance the capital of Tanzania’s Agricultural Development Bank (TADB). These funds will empower Tanzanian farmers, promote agricultural production, and stimulate economic growth across the nation.

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Dr. Patricia Laverley of AfDB expressed satisfaction in participating in these transformative projects, emphasizing the SGR’s potential to bolster regional cooperation and support the African Union’s vision of a united Africa by 2063.

Transport Minister, Hon. Prof. Makame Mbarawa, highlighted the railway’s significance as a vital transport link between Tanzania’s ports and neighboring countries. The construction of the railway section from Uvinza to Musongati, in collaboration with the Government of Burundi, is poised to unlock vast mineral resources, catalyzing economic development in the region.

Prof. Mbarawa noted that the railway’s construction standards would mirror those of the Dar es Salaam to Mwanza line, ensuring high-speed transportation for passengers and freight, thereby bolstering trade and economic growth.

About SGR and TADB

The government of Tanzania is currently expanding the country’s rail network with the construction of an SGR to replace the old, inefficient meter-gauge railway system.

The SGR will link Tanzania, from the port of Dar es Salaam on the Indian Ocean to the port of Mwanza on the shore of Lake Victoria in northern Tanzania, and from there to neighboring countries of Rwanda, Burundi, and the Democratic Republic of the Congo (DRC).

The Tanzania Agricultural Development Bank (TADB) is a state-owned development finance institution established to deliver short, medium, and long-term credit facilities for the development of agriculture in Tanzania.

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